Monthly Archives: December 2011

Are you seeking a female forensic accountant or fraud investigator to be an expert witness in your case? Do you think a woman on the team might be helpful if your case goes to a jury trial? Are you looking for diversity that may appeal to a wide range of jurors? Does it really matter?

I don’t care much about the gender of my clients, and most of my clients don’t seem to care much about my gender. Almost all of my work comes from attorneys (on behalf of their individual or corporate clients), and most often I am dealing with someone at the partner level. Because of this, my clients are overwhelmingly male. Read More →

You hear the commercials on television and radio almost daily: We can reduce your tax debt to pennies on the dollar. The charlatans claim they can help get rid of your IRS debt and state income tax debt. Who they’re really helping is themselves…. to your wallet.

When a party to a divorce or child support case is believed to be hiding income or assets, one way uncover proof of it is through a lifestyle analysis. Such an analysis is not only helpful in establishing the true income of the subject, it can also uncover inconsistencies which reflect negatively on the subject’s credibility.

One key piece of documentation that can help your case against someone who is concealing income or assets is a loan application. When borrowing funds for homes, cars, boats, or business investments, people are often required to disclose details of their personal finances. This usually includes disclosing monthly or yearly income, as well as the value of assets such as homes, vehicles, real estate, and business interests. Read More →

In divorce and child support cases, one party may attempt to hide income and assets to deprive the spouse or children of their rightful support. It can be difficult to prove hidden earnings or assets, particularly if the other party owns a business, owns assets within corporations or partnerships, or has other financial vehicles that could be used to conceal wealth.

However, there are ways to discover the existence of assets or reasonably estimate the person’s level of earnings. One such way is a lifestyle analysis, which calculates the earnings necessary to live the known lifestyle of the target.

Last week the Salt Lake Tribune published a fantastic article about the reality in multi-level marketing, entitled Utah Juice Companies Offer Few Prospects. MLMs like Mary Kay, Amway, MonaVie, and Herbalife have been claiming that the great recession has increased the number of distributors because people are looking for ways to make money during this time of high unemployment. The problem with this claim is that while more people are signing up for these bogus business opportunities, almost no one is actually profiting from their activities.

Multilevel marketing companies like to refer to themselves as “direct sales” companies. They want to keep the focus off recruiting and onto selling of the products directly to customers. The problem is that little actual retail sales occur for a number of reasons: Read More →

The current #Occupier of the White House loves to tell us about the “failed policies of the past…” But let’s have a look at what the real failed policies of the past are:

The War on Poverty. According to the Census Bureau, in 1966 the poverty rate was 11.8%. It has remained in a range between 8.7% and 12.3% for the last 46 years. Fail. Giving money to people with no strings attached does not eliminate poverty. Helping those who cannot help themselves is a moral obligation, but the able-bodied need to work and pay their bills and taxes like the rest of us. Read More →

Reasonable accountants can disagree about whether a move to International Financial Reporting Standards (IFRS) will improve financial reporting. One key concern is that principles-based financial statements are much more susceptible to fraud. Rather than relying on strict rules, management’s judgment will guide much of the reporting. Clearly this creates a risk of fraud, but how big is the risk?If we look at companies engaged in financial statement fraud under Generally Accepted Accounting Principles (GAAP) reporting, we often see that the abuse happens in accounts that require judgment in establishing balances. For example, reserve accounts require management to estimate the cost and timing of expenses. Sometimes firms intentionally understate the reserves to boost net income, thereby easily abusing these accounts. Other times, reserves can be overstated to create a cookie jar through which future losses can be concealed. Read More →

To give a sense of the scale of this unprecedented investment in questionable private securities, currency in circulation is $1,052 billion so the Fed owns almost as many mortgage-backed securities as there are dollars in existence. Read More →